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2022 SPX put credit spreads trading review – week 06

Last week’s market was horrible. The new rally was rejected and the markets lost yet our SPX strategy gained. The gain is however in danger if this market continues freaking out about already known things (nothing that sent the market down was unknown). If the market continues lower, we will be adding call spreads and roll our put spreads or let them expire in the money for a loss (while our call spreads help offset the loss).

Despite the horrible week, our SPX PCS strategy finished the week up +11.99% while SPX was down -1.82%. Our overall SPX account is up +86.86% since the beginning of this program.
 

Initial trade set ups

 

For my SPX strategy, I dedicated a $3,600 initial amount that will be used to trade SPX PCS strategy per week. If this amount is depleted, I will evaluate the strategy to determine whether to continue or change it. If I grow this amount, I will scale up the trading.
 

WHAT WILL WE TRADE?    
DAY DTE TYPE
MONDAY 7 DTE Put Credit Spread
TUESDAY 30 DTE Put Credit Spread
WEDNESDAY 7 DTE Put Credit Spread
FRIDAY 60 DTE Put Credit Spread
EVERY MONTH 120 DTE Put Debit Spread – HEDGE

 

Last week trading

 

DAY SIGNAL TYPE TRADE STATUS
MONDAY Positive New 7 DTE trade opened
credit: $145
Exp: Feb14
TUESDAY Positive New 30 DTE trade opened
credit: $275
Exp: Mar11
WEDNESDAY Positive New 7 DTE Call credit spread trade opened
credit: $310
Exp: Feb16
FRIDAY Negative No new trade
EVERY MONTH No new trade

 

On Monday, our entry signal was positive and we opened a new trade collecting $145 credit. The market was showing some weakness so we reduced our risk lowering our delta. As of today, the trade is still safe but if the market continues going down, we will need to adjust this trade.
 

On Tuesday, our entry signal was positive and we opened a new trade. I was still cautious lowered the delta. We collected a $275 credit for this trade. The trade is currently in the money but time is on our side so we will wait.
 

On Wednesday, our entry signal was positive, and we opened a new put credit spread. Unfortunately, when the stock dropped on Thursday (again) on the comments of the St. Louis James Bullard that he was open for more rate hikes and other nonsense. The market collapsed. Now, the trade is in the money. We added a call spread to hedge this trade and collected additional $350 credit. We will wait for the market to recover and if not, we will roll the trade away (it will be a debit trade though).
 

On Friday, the signal for the 60 DTE trade was negative and we remained out of the market.
 

We didn’t open any new 120 DTE debit hedging trade this week.
 

Here are our delayed open trades:
 

SPX PCS delayed trades week 6
SPX PCS delayed trades
 

The trades are two weeks delayed. If you want to see the most recent trades or receive alerts, subscribe to our SPX alerts.
 

Overall, the strategy resulted in a $720.00 gain last week. Note that the gain might be unrealized as some or all trades may be still open.
 

Initial account value (since inception: 12/07/2021): $3,600.00
Last week beginning value: $6,007.00
Last week ending value: $6,727.00 (+11.99%; total: +66.86%)
The highest capital requirements to trade this strategy: $11,998
Unrealized Gain: $947 (+8.57%)
Realized Gain: $2,180 (+19.72%)
Total Gain: $3,127 (+28.29%)

 

SPX PCS account value
SPX PCS account value
 
Our SPX net-liq increased a bit last week. I consider it a good result since the market is volatile and non-trending, well, it is trending but the trend is choppy and weak.
 

SPX PCS account vs SPX
SPX PCS account vs SPX index net liq
 
However, comparing the account with SPX net-liq, we are still outperforming this horrible market.
 

SPX PCS account vs SPX
SPX PCS account vs SPX index
 

If the market continues being this choppy or even going down as fast as it has so far, I expect to use the gains to roll the trades that are in the money.

If you want to receive trade alerts whenever we open a new SPX put credit spread or a hedge trade, you can subscribe to our service:

 

SUBSCRIBE HERE

 

Note, if you wish to subscribe to multiple levels, you can do so by subscribing to one level only and then send us an email that you want to be added to other levels too.

Also, if you like this report, hit the like button so I know there is enough audience wanting to see this type of report. If you have any questions or want to see anything else about my SPX trading, do not hesitate to contact me or write a comment in the comments section. Thank you!

 
 





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